The Cabinet has extended the fuel excise reduction of 5 baht per liter for another four months.
Following a Cabinet meeting this week, Deputy Finance Minister Santi Promphat announced the decision, adding that the policy is aimed at lowering living expenditures and preventing a rise in consumer goods prices.
The newest round of fuel tax cuts is estimated to cost the Excise Department around 40 billion baht in lost income, or approximately 10 billion baht each month. This is the sixth time the exemption has been extended since February 2020, costing the government an estimated 140-150 billion baht in fuel tax income.
Santi, on the other hand, claimed that the cut would have no effect on the government’s finances since it had earned an additional 33 billion baht in revenue from the sale of mobile phone and radio bandwidths, as well as tax fines on imported products.
He went on to say that the Ministry of Finance’s income for the first two months of the fiscal year 2023 was 55 billion baht more than expected, and that the ministry expected to make another 2.6 trillion baht by September.
According to the deputy minister, the government also intends to borrow 695 billion baht to balance its budget deficit, with 3.1 trillion baht expected spending. The treasury is forecast to have a cash balance of 710 billion baht at the conclusion of the fiscal year, keeping the government’s financial condition constant and untouched by the excise decrease.